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WATCH OUT FEDERAL RESERVE:
Senate agrees to expanded ‘Audit the Fed’ provision
GREAT NEWS: the Senate committee that is currently working on a compromise Wall Street reform bill to reconcile with the House version has agreed to expand an audit of the privately owned and controlled Federal Reserve.
While still not a total probe of the Federal Reserve System, the measure is being sold as a first step toward complete transparency of the U.S. central bank. Both the Senate and the House have already passed legislation that is intended to rein in the casino-like behavior on Wall Street. However, these two bills are noticeably different and have to be worked out in committee.
The House’s version would mandate multiple audits of the Fed’s discount windows and open market dealings, which would shed light on the Federal Reserve’s lending activity with U.S. and foreign banks. On the other hand, the Senate’s bill calls for only one audit.
Legislators are now hard at work on a compromise bill that addresses the disparities.
According to published reports, senators in committee have agreed to allow repeated audits of the Fed’s key functions. This will finally give the American public a window into how the central bank works to benefit the “banksters” themselves.
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No one knows the exact details yet. But populist Americans are optimistic that whatever comes out of committee is going to impact the speculators and traders on Wall Street, who have driven the U.S. economy to the brink of collapse.
One online commentator remarked on the bill: “The details of the final proposal are still being worked out, but momentum is with advocates of Federal Reserve transparency.”
That is good news.
But even better news is the fact that, according to a new analysis by one of the largest banks in the world, the proposed Wall Street reforms will cost Wall Street as much as a quarter of its annual profits.
Citigroup reports that Goldman Sachs could lose as much as 23 percent of its profits when financial reform passes. Morgan Stanley could lose nearly 20 percent. JP Morgan is facing a hit of 18 percent, and Bank of America could see up to 16 percent of its gains disappear over night.
The losses are attributed to increased regulations that will force financial firms to cough up more of their own money to back the bets they make. There are also a host of new fees and taxes that will go in effect, which the
money trust will have to pay.
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(Issue # 27, July 5, 2010)
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